You need to amend the 2021 tax return to report the recharacterization. When you do so you will get a refund of any penalty you paid for overcontributing to the ROTH IRA. The amount recharacterized will be the $6,000 contribution. You are correct, none of this will affect 2023 return.
You need to report the earnings ($234) as taxable in 2021. You can enter a subsitute form 1099-R in 2021 to do this:
- Choose the Federal option on your left menu bar
- Choose Wages & Income
- Choose the Retirement Plans and Social Security menu option
- Choose IRA, 401(k), Pension Plan Withdrawals(1099-R)
- Choose the enter 1099-R option
- Choose Change how I enter my form
- Choose Type it in myself
- Choose Financial institution or other provider (1099-R)
- Enter in as much information as you can regarding the pension income
- Work through that section until you see Do any of these situations apply to you?
- Choose I need to file a substitute 1099-R
- Complete the information requested
Enter the earnings in box 1 and box 2(a) and use code "8" in box 7.
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